Taking another step toward shedding its reputation as the tech industry’s most notorious patent troll, Intellectual Ventures is launching the first company from its incubator.
The company’s ISF Incubator has licensed technology to LexSet — a spinout launched by two bi-coastal serial entrepreneurs (and recovering architects) Leslie Karpas and Francis Bitonti — to roll out a suite of augmented reality tools for interior design and furniture assembly.
The multi-billion dollar home design industry is a massive global business. Everyone in the world, it seems, wants to keep up with the Joneses — or at least with the images they see on the Joneses’ Instagram and Pinterest accounts.
Just ask the investors in companies like Wayfair, which is now publicly traded with a market cap of nearly $5.8 billion; or Laurel and Wolf, which raised $20 million at a nearly $100 million valuation from none other than Benchmark Capital — one of Silicon Valley’s marquee investment firms.
In all venture investors have backed roughly 60 deals with some $1.4 billion in financing in the home decorating or interior design space, according to a search on Crunchbase. So it’s no surprise that a market that vast would be one of the first to attract the attention of entrepreneurs and the imagination of Intellectual Ventures’ newly minted ISF Incubator.
Seattle-based Intellectual Ventures has long been viewed with no small amount of contempt (and a large amount of fear) by Silicon Valley’s investment class, because of its reputation as a patent hole — a gaping maw in the Northwest corner of the U.S. where patents go to die and be reborn as fodder for litigation.
As an Economist profile put it in a 2015 article:
In its 10 year life, [Intellectual Ventures] has filed more than 3,000 patents for its own inventors’ work, and acquired 70,000 more, putting it ahead of the likes of Google, Toyota and Boeing. “What venture capital did for startups,” Myhrvold says, “we want to do for inventions.”
Critics would argue that Myhrvold’s high-minded talk is belied by his company’s predilection for litigation over innovation.
The same article sees Myhrvold responding to those Valley critics.
“Silicon Valley is a very aspirational place. Everyone’s aspiring for their Nirvana or heaven, which is to become super-fucking-rich and powerful very young. ‘Oh my God, I’ve got this god-given right to go out and take any idea I want and become a billionaire at age 30.’ Very few get that, but that doesn’t stop them idealising [sic] it. It’s kind of a secular religion, and what we do, rewarding people who originate ideas, is apostasy to them because it’s not their algorithm.”
And for the past several years the firm has been working hard on research to generate its own intellectual property and to use that trove of patents to build new companies rather than just suing existing ones.
LexSet is one of the early fruits of that labor.
Using a combination of machine learning and visualization tools culled from the IV portfolio along with the skills Karpas and Bitonti honed as architects and designers, LexSet has built a clutch of products for furniture makers and home design retailers to boost sales. The products let users scan their homes and furniture to come up with design and decoration suggestions.
Right now it’s a recommendation engine for interior design and an instruction manual for building out furniture — if the company’s recommendations were generated by an incredibly sophisticated algorithm that was refined by two of the foremost designers operating at the intersection of technology and the arts.
Karpas, previously invented manufacturing processes for Turner Award-winning artist Anish Kapoor and developed new ways to print medical grade silicone as the founder of the medical device company, Metamason. Bitonti, founder of Studio Bitonti (and an old New York contact of mine) has designed 3D printed objects, one of which is included in the collection of the Smithsonian.
Karpas first heard about the ISF Incubator from a mentor who’d encouraged him to do a bit of digging through the intellectual property on offer.
He started working with ISF in June with Azam Khan, director of new ventures at ISF Incubator, on potential products and received formal approval to develop technology with the spinout later that summer.
The company’s products consist of four distinct tools: LexSight, which combines image recognition tools that identify objects in a room and recommends other decorations or spatial configurations to compliment the existing objects; LexGuide, which offers a catalogue of offerings from different retailers; LexTile which can create different tiling patterns for surfaces; and finally, LexSemble, which provides instructions for making furniture in augmented reality.
“A lot of these things are hard to describe,” says Bitonti. “The leverage the work we’ve done in generative tooling.”
For Khan, the pairing was nothing short of serendipitous. “Les had the spark to build the suite on top of the inventions in our portfolio,” he said. “And he had validation from Fancis on the technical side.”
Bitonti and Karpas may have built the toolkit, but it’s the capital and intellectual property from Intellectual Ventures’ incubator that’s been the engine driving the initial business, according to Khan.
It’s important to note, that the LexSet business is the first to spin out from Intellectual Ventures’ newly formed incubator. The company has actually spun out 15 companies already, according to Khan, which have raised $700 million in venture funding.
“What you’re sewing now is an ability to rapidly do that,” Khan said.
Another critical component of the incubator program is that it applies only to patents that have been developed inside of Intellectual Ventures, according to Khan. For him, it’s about, “creating a program to unlock other parts of our portfolio.”
The Invention Science Fund is tapping the parent portfolio of things that have been invented exclusively inside of Intellectual Ventures. Khan said that it’s a prime subset of the IV patent portfolio.
Khan didn’t disclose the amount of capital that the parent company committed to the fund, but said that the incubator would be seeding companies to the tune of “the low hundreds of thousands of dollars.”
The central thesis, said Khan, is to give the spinouts control of the intellectual property upon spinout, and not charge a licensing fee for future applications of the technology.
In the case of LexSet, those goals are much larger than simply providing tips and tricks for design thinking in a built environment, according to Karpas.
“What Francis and I are doing is to give anybody, anywhere an ability to create anything with the tools that they have around them,” Karpas said.
Featured Image: Tom Sibley/Getty Images
Published at Tue, 21 Nov 2017 12:05:07 +0000